Master-Keyed Lock Systems

Liabilities vs. benefits

By Christopher Shope

Mention "master keying" to many self-storage operators and theimmediate response is a nervous "I don't want to leave myself open toliability." It's natural to fear the unknown--especially when you add tothat fear the messages put out by some industry attorneys who have advisedagainst operating a facility with this capability. It's easy to understand whysome would have that reaction.

Operators worry a master-keyed system may put them in the position of awarehouse operator rather than a landlord. And the concern may be justified tosome degree. If you put up a facility, throw a generic master-keyed system onthe doors and don't include any mention of it in your lease, you will definitelyleave yourself open for problems.

Twenty years ago, industry experts recommended that operators not sell locksfor fear of liability. Ten years ago, it was suggested there was a problem withthe cylinder lock that had the overlock function. Now the big controversy ismaster keying of facilities. But the bottom line is: If you conduct yoursecurity program in a professional manner and draft a thorough lease thatexplains all aspects of reason for entry, you'll be legally protected. And youcan reap the benefits master keying has to offer.

Operations

There are two elements to a successful master-key operation: a professionaloperating system with management controls, and a lease that addresses all thepertinent issues without getting you into the dreaded "warehouse"territory. First, let's talk about operations.

If you decide to operate with a master-keyed cylinder or padlock system, youmust make sure the keys are restricted. A restricted key is one with a blankyour local locksmith or hardware store cannot duplicate. You must also makeabsolutely sure the lock you use has sufficient key codes. For example, on ourhigh-security system, we can achieve approximately 3 million different keycodes. This assures that every unit has, without question, a different keynumber.

Key control is an essential part of this program as well. Facilities shouldmaintain no more than two master keys at any given time and store one of them ina "key safe" at a remote location, such as the company's main office.A key safe creates an audit trail, which accounts for the keys' location 24hours a day. Each authorized person has an individual code, so when the safe isopened, it logs who removed the master key and the time and date. Our customerswho use this type of program also typically employ 24-hour video surveillance,access control and, in some cases, individual door alarms.

Lease Construction

Now, let's tackle the legal side of this system. It is critical to draft aclear and detailed lease that has an addendum explaining the master-key systemand conditions for entry in simple terms. One of our largest customers operateswith master-keyed cylinder locks in 21 facilities and six different states. Asection of their lease clearly states the landlord's right to enter. As you cansee below, they have laid out all the instances where the master key would beused to enter a renter's unit in simple and plain terms. (The following excerptis for illustrative purposes only. You should consult with a qualified localattorney in the construction of your own lease. Be advised that self-storagelaws and regulations vary from state to state, and sometimes even from one localarea to another.)

Landlord's Right to Enter

Upon the reasonable request of Landlord, Tenant shall provide access to theLandlord to enter the Premises for the purpose of inspection, repair,alteration, improvement or to supply necessary or agreed services. In case ofemergency, Landlord, its agents or employees may enter the Premises, withoutliability there-for and without affecting Tenant's obligations under this lease,for any of the above stated purposes without notice to consent from Tenant. Theterm "Emergency" shall mean any sudden, unexpected occurrence orcircumstance which demands immediate action. Tenant agrees to allow FireDepartment and Landlord, its agents and employees to enter the premises at alltimes which are reasonably necessary to insure the protection and preservationof the facility or any personal property stored therein.

Communicating the lease and this particular section to potential renters, aswell as re-emphasizing it in your rental agreement, will ensure your tenantshave full knowledge of the system's capability and when it would be put intouse.

Liability?

Another important issue to consider with master-keyed systems is the practiceof "recycling" cylinders or padlocks after they have been returned byrenters. Our clients usually charge a security deposit for the lock and twokeys. If the tenant does not return both keys to the lock he was issued, thelock is taken out of circulation and the tenant loses his deposit. If both keysare returned, the facility returns the lock and keys to circulation after sixmonths.

This is where operating with a restricted-key system comes into play. If youoperate with a run-of-the-mill standard keyway where keys can be duplicated, youtake a big risk. If you employ a restricted-key blank and a 3-million key-codesystem, there is virtually no chance of unauthorized access to any unit.

Liability is a constant concern in this industry, and for good reason. No onewants to be accused of criminal acts, especially in his own business operation.However, in self-storage we face far greater liability issues than thoseassociated with a well-run master-keyed facility. For example, look at all ofthe companies in this industry that sell tools that manipulate locks, such asdrilling tools, "disk busters" and--even scarier--lock-picking tools,the advertisements for which clearly state they allow users to "gaindiscreet entry in seconds."

Such tools are the last thing in the world I would want at my facility. I wasonce out making sales calls and stopped at a storage facility. The assistantmanager was on duty but got called out to the yard by a customer. When she left,I noticed a video on her desk containing instructions on how to break locks.Imagine if I weren't an honest person--I could have stolen the tape and startedrobbing storage units for a living. Imagine if I were a potential renter and hadseen that! Tools of this kind belong in the hands of bonded professionals, plainand simple.

Since 1986, when my company pioneered master-keyed systems for the storageindustry, neither we nor any of our clients have been faced with liabilityissues or a key-duplication problem. A master-keyed system isn't for everyone,but if you operate a professional security program and write a lease thataccommodates your system, the worries of liability are better saved for otheraspects of your business.

Most of our clients who operate with master-keyed systems aren't cowboys outto rock the boat--they are industry leaders, attorneys and even associationofficers. What they get with master-keyed systems is the highest level ofsecurity. Master-keyed systems feature flush-mounted cylinders with hardenedsteel fronts that resist the threat of break-ins. At the same time, they providemanagers the ability to safely and legally access units in an emergency, undercarefully controlled circumstances. The only people who love high-securitymaster-keyed facilities more than renters and operators are local fire marshalsand zoning boards. The payoff is significant market visibility as a safe andsecure facility.

Christopher Shope is the national marketing and sales director for LockAmerica Inc. (d.b.a. L.A.I. Group), which manufactures a complete line ofsecurity locks and custom-designed security hardware for the self-storage andother industries. The L.A.I. team is committed to taking knowledge gained fromother security industries and applying it to the self-storage market. For moreinformation, call 800.422.2866; www.laigroup.com.